The price of being certifiably ‘green’

Go into any store and you run into the term “green.” Bags of chips, detergents, new cars and fluorescent-light bulbs — all are bedizened in alleged greenness.

But what, exactly, does green mean? And who should get to declare themselves green? Should low-flow toilets get the same credit as solar panels?

In the building industry, the question isn’t academic — it’s critical to the bottom line. Green buildings and homes command a higher price tag. But the cost of true, environmentally friendly building is also steep. So how green is green?

That’s where LEED comes in. LEED, which stands for Leadership in Energy and Environmental Design, is a third-party green-building rating system that certifies buildings based on their merits as environmentally sustainable structures.

There are various incarnations of LEED — LEED for homes, for existing buildings, for retail, for health care, for commercial interiors — and different levels within each: certified (basic level), silver, gold and platinum, and the ranks are handed out based on points in five categories.

LEED is fairly customizable from building to building; which is a plus, given that what might be a massive, energy-saving measure in one structure would create trivial benefits to another. Builders can pick which categories they want more points in, and then which measures and materials they want to use to get them.

Paying a green price

But it’s costly. The price of LEED-style building over traditional methods is about 2 percent, said Scott Donald of Padgett and Freeman Architects in Asheville. About a quarter of Donald’s business is in LEED projects.

Fees vary, depending on size and which LEED program is giving the award, but for a large commercial building, a construction and design review can run as high as $27,000. And when it comes down to the bottom line, sometimes the merits of being certified don’t outweigh the costs — especially when all the environmental elements can be built in without certification. So property owners who might have come in liking the ranking may opt to sidestep it, building a LEED building without the LEED name.

“It actually occurs a lot,” said Donald, “because they don’t want to pay for the actual certification and the energy models, and the design is pretty much the same.”

That fee? It pays for extensive documentation. And in return, LEED provides an outsider arbiter, making sure everything is done properly.

“That’s where you lose by not doing LEED is during the construction process,” said Donald. “The end product is very similar, but the process is not at all. That’s part of what LEED does.”

But the real treasure that LEED has to offer is its name — a recognized brand of environmental friendliness.

“The value of a certification comes in when you’re trying to sell a building. That’s where that brand comes in,” said Maggie Leslie, the program director for the Western North Carolina Green Building Council, which helps builders navigate the LEED process.

“For someone who’s trying to sell a home or a building, instead of trying to explain all the terms, it’s a marketing program. It’s to help people communicate the value of these things.”

A trend that keeps on growing

George Ford, an assistant professor at Western Carolina University, teaches construction management. Recently, he’s been teaching a lot more about LEED. From the contractor’s perspective, the view is the same as from the owner’s; knowing green-building practices isn’t the same as knowing LEED building practices.

“A lot of times, that could be the difference between them getting the job and not getting the job,” said Ford.

Because of that, the professor has seen an increase in LEED certifications over the last several years.

In a tough construction industry, any edge is a good edge, especially if it offers true legitimacy in a quagmire of faux green.

And, for a quick bit of history, that’s why it was created.

“LEED has been around for 10 years, and it was created out of a response and a cry from the building community saying, ‘We want to stand out. There is no standard, and how do we separate ourselves from anyone else who says that they’re green?’” said Emily Scofield. She’s the executive director for the Charlotte region chapter of the U.S. Green Building Council, the third party in third-party ratings system. They’re the ones that give out LEED badges.

Scofield views LEED as less a selling point and more as a mark of quality. She said the benefits of adhering to the system’s high standards are self-evident and good for health, the earth and the bottom line.

A 2010 McGraw Hill study found that, for new buildings built to LEED standards, operating costs dropped by just over 13 percent — eight for existing buildings that were retrofitted — while the value of new LEED buildings rose nearly 11 percent, compared to what it would’ve brought traditionally.

That’s part of why Donald is so successful in convincing his clients to go for sustainably designed buildings, whether they get the LEED stamp or not.

“If you meet the goals that LEED establishes, you’re going to save a lot of money,” said Donald, pointing to one of his recent projects, the new Cherokee Central Schools complex, as an example.

“Right now, they’re probably saving over a quarter of a million dollars a year,” said Donald, and he projected that the tribe would save $10 million over the life of the buildings.

And that, of course, is the basic premise of good branding. LEED isn’t just a name. It’s a symbol of quality and a promise that green really does mean green. People know and trust it, and that’s got a good deal of intrinsic value.

But they’re not the only player in the game. There are more green ratings systems out there. Some, like Energy Star, work in concert with LEED; some are in competition with it.

Different programs have their own merits, including, for many, lower fees. But in this relatively young market, LEED is still the front-runner, the internationally recognized standard that serves as the benchmark.

“I think that competition is good, and ultimately we’re all trying to achieve the same goal,” said Scofield. “If their intent is true, we don’t mind the competition.”

And really, LEED will have to keep evolving, not only to stay ahead of the competition, but to stay in business altogether. The general consensus among architects and builders alike is that the standards that are LEED today will simply be the building code tomorrow, rendering LEED and its ilk obsolete, at least in their current forms.

Today, new technologies like solar power and geothermal wells are becoming the next wave of green trends, but in five years time, the leading edge of the green movement will be somewhere else entirely, which will always leave LEED, and the professionals who follow it, somewhere greener to grow.